Small and Medium Business Interruption Insurance
Business interruption insurance can help you recover and get back on track after an unexpected significant property loss. Whether you are a sole trader, run a local business or own a small to medium-sized company, we can help you obtain competitive business interruption insurance quotes from insurers.
When the normal operations of your business are interrupted by an unexpected property loss or damage, your expected business income is also interrupted. Without the usual stream of income, your business may struggle to cover its operating costs or achieve a reasonable level of profit.
For small to medium-sized businesses, even a short period “out of business” could have a significant financial impact on the future viability of the business. A serious fire or storm could force a business to temporarily shut down or reduce operations. Business interruption insurance can help get your business back on its feet so it can continue operating. It is designed to help restore your business to the financial position it was in before the property loss or damage occurred, by making up for lost income, assisting with cash flow and helping cover ongoing costs.
Who needs business interruption insurance?
All kinds of businesses can benefit from business interruption insurance, regardless of shape and size. Business interruption insurance can often be the “make or break” for whether a business survives a serious property loss.
It is important for small to medium-sized business owners in particular, as the overall financial impact can often be more severe when their business is disrupted or forced to close. Business interruption insurance can be critical in helping them get through a temporary crisis.
Many small and medium-sized businesses in Australia would not survive a prolonged shutdown.
How much does business interruption insurance cost?
The cost of business interruption insurance varies depending on the size, nature and location(s) of your business. Different insurers may also have different pricing structures. It is also important to get your declared values right when obtaining a business interruption insurance quote.
Marsh is not an insurer. We are a professional insurance broker, advisor and risk management expert dedicated to helping businesses like you. We can obtain business interruption insurance quotes from multiple insurers and provide advice and recommendations to our clients.
We negotiate competitive premium prices and insurance coverage to deliver value to businesses and help to ensure you have the right level of cover.
In addition to obtaining quotations and placing the policies, Marsh can also assist with claims. We can help to manage, negotiate and settle claims with insurers on your behalf.
What is covered by business interruption insurance?
Business interruption insurance typically covers loss of income and increased costs of operating as a result of an insured event (property damage or loss) under your property insurance policy.
The policy is intended to provide cover from the date of the loss to when your turnover is back to its pre-loss level, however, this is subject to the coverage limits obtained and any applicable time deductible. Generally, business interruption insurance covers:
- Loss of income
- Ongoing expenses (Eg. payroll, financing and other fixed costs)
- Additional costs required to return to normal business operations
- Revenue earning operations, supply chain and manufacturing dependencies
- Disruption caused by service providers including power, telecommunications, water
What is NOT covered by business interruption insurance?
Voluntary shutdown or business interruption unrelated to a property loss/damage is typically not covered under business interruption insurance. A business interruption policy will also have an excess (or deductible) and policy limits, and cover may differ from insurer to insurer. Also, insurers will not accept risks which have already crystalised such as interruptions caused by the current COVID-19 situation. It is important that you read your policy wording to understand the full list of business interruption insurance exclusions and policy conditions.
Need help understanding what your policy covers and excludes? Contact us.
What is an “indemnity period”?
An indemnity period is how long a business interruption insurance policy will pay for the interruption of your business. The indemnity period should represent the maximum amount of time it will take to get the turnover of the business back to normal after a worst-case scenario incident.
Many factors will need to be considered to determine the appropriate indemnity period for your business. This needs to be discussed in-depth with your insurance advisor.
Please note: Marsh Advantage Insurance Pty Ltd (ABN 31 081 358 303, AFSL 238369) (“Marsh”) arranges the insurance and is not the insurer. This webpage contains general information, does not take into account your individual objectives, financial situation or needs and may not suit your personal circumstances. Marsh makes no assurances regarding the availability, cost, or terms of insurance coverage. For full details of the terms, conditions and limitations of the covers and before making any decision about whether to acquire a product, refer to the specific policy wordings and/or Product Disclosure Statements available from Marsh on request. LCPA No. 20/270.
Marsh Advantage Insurance Pty Ltd (ABN 31 081 358 303, AFSL 238369) (“MAI”) arrange this insurance and is not the insurer. The Discretionary Trust Arrangement is issued by the Trustee, JLT Group Services Pty Ltd (ABN 26 004 485 214, AFSL 417964) (“JGS”). JGS is part of the Marsh group of companies. Any advice in relation to the Discretionary Trust Arrangement is provided by JLT Risk Solutions Pty Ltd (ABN 69 009 098 864, AFSL 226 827) which is a related entity of MAI. The cover provided by the Discretionary Trust Arrangement is subject to the Trustee’s discretion and/or the relevant policy terms, conditions and exclusions. This website contains general information, does not take into account your individual objectives, financial situation or needs and may not suit your personal circumstances. For full details of the terms, conditions and limitations of the covers and before making any decision about whether to acquire a product, refer to the specific policy wordings and/or Product Disclosure Statements available from Marsh Advantage Insurance on request.